The New FRCP One Year Later

Tonight I attended a presentation at the Benjamin N. Cardozo School of Law of Yeshiva University, hosted by the Cardozo Data Law Initiative and the Sedona Conference. The panel consisted of Judge Ron Hedges, (a former Magistrate Judge for the U.S. District Court for the District of New Jersey); Steve Bennett, a partner with Park Jensen Bennett LLP; Matt Knouff, eDiscovery Counsel at Complete Discovery Source; and Ariana Tadler, a partner at Milberg LLP. The presentation reviewed the impact of the December 1, 2015 amendments to the Federal Rules of Civil Procedure. The materials are part of the Sedona Conference's training program, which included a PowerPoint slideshow with video clips of judges discussing their views on the meaning of the revised rules. The following are my rough notes on the discussion.

Knouff began the presentation by discussing the data explosion that has taken place since the previous revision of the rules in December 2006. Facebook and Twitter started in 2006, (actually the former just became widely available that year), and Hadoop was introduced in 2007. Microsoft reports that for an average case it preserved 48 million pages; collects 13 million pages; and reviews 645,000 pages. The presentation reviewed the history of the process of arriving at the 2015 amendments, which involved the initial conference at Duke in 2010; public hearings in D.C., Phoenix, and Dallas with testimony by 120 witnesses; and more than 3000 submitted comments - far more than the usual number. Tadler noted that the proposed rules were perceived as being pro-business, and that an rough mix of comments from both plaintiff and defense lawyers were received.

Judge Hedges noted that new rules effecting service and deadlines under the rules will come into effect this week.

The group emphasized the key goals of the December 2015 amendments:

1. Cooperation

2. Early case management

3. Changing the scope on the basis of relevancy and proportionality.

4. Establishing national sanctions standards. [or curative / remedial measures, as Rule 37 doesn't actually use the term 'sanctions'.]

The group noted Judge Lee Rosenthal (S.D. Tex.) has stated that despite the committee note to FRCP 1 stating, "Effective advocacy is consistent with — and indeed depends upon — cooperative and proportional use of procedure.", parties should not even think of filing motions on the basis of opposing counsel not being cooperative. Rule 1 only states an expectation. It's declaratory.

Judge Hedges noted that the key ethical guidelines were the counsels' duty of candor to the tribunal under Model Rule of Professional Conduct 3.4 and duty of candor to the tribunal under Rule 4.4. He also referred to the California Bar's Formal Opinion No. 2015-193 which stated that lawyers had an ethical obligation to understand electronic discovery technology. He recommended reviewing the Sedona Jumpstart Outline, co-authored by Tadler, which provides an outline of issues to discuss with clients on preservation problems and responses to requests for production. Bennett noted that the notes to the ABA's Rule 1.1 also discuss the need to be aware of, "benefits and risks associated with relevant technology".

Judge Hedges has noted that local rules have expanded on the cooperation requirement and specifically referenced the rules specific to Judge Paul Grimm's (D. Md.) chambers, which I believe are posted here, and state that. "Whether a party or counsel has cooperated during discovery also will be relevant in determining whether the Court should impose sanctions in resolving discovery motions." Since the Sedona Cooperation Proclamation was issued in July 2008, 150 state and local judges have endorsed it, and it has been cited in 50 published opinions.

Judge Hedges recommended that Judge Peck's Rule 502(d) template order be used to address the clawback of inadvertently produced privileged documents.

Knouff noted that while Rule 34 document requests can be delivered 21 days after a summons is served, they are not actually considered served until the Rule 26(f) conference takes place. He noted that FRCP 34(b)(2)(c) requires objections to be stated when data is withheld. Bennett speculated that it might be possible to make 'reserve objections' in case later view of data indicates they are needed, but Judge Hedges brought up that this could fall afoul of the FRCP 26(g) certification requirement. Knouff pointed out the District of Kansas decision (in Rowan v. Snowflower ?) that allows for the specification of data searches as basis for indicating what data is being withheld, as an alternative to the privilege log format that would list individual documents withheld.

The group provided this sample objection as good an example of what can be used to respond to a document request:

Tadler cautioned this should not be used as a boilerplate for any case as salary information could be relevant for employment cases. Judge Hedges faulted this form response for not listing a basis for withholding 17 pages of files.

Jim Daly of Seyfarth Shaw LLP was in the audience and pointed out that the SEC, DOJ, and FCC have specific requirements for the forms of production which are in the Code of Federal Regulations.

Steve Bennett noted the comment to FRCP 26(b)(1) which states, "Computer-based methods of searching such information continue to develop, particularly for cases involving large volumes of electronically stored information. Courts and parties should be willing to consider the opportunities for reducing the burden or expense of discovery as reliable means of searching electronically stored information become available." is a reference to the use of TAR which he predicted would be become the dominant form of review in the next 10 years. Judge Hedges questioned this because he said that at least 9 out of 10 cases don't involve large document productions. Running keyword searches might be sufficient in smaller scale cases. The judge made a reference to 17,000 documents as being the break even point for TAR, which is a possible reference to a max size for a seed set. See this posting on the Catalyst site.

Judge Hedges complained about the fact that in attempting to use letters rogatory to obtain overseas production, he only found out after 11 months that France wasn't going to provide the production.

In a video clip, Judge Craig Shaffer of the District of Colorado noted that Rule 26(b) would have to be applied against the backdrop of FRCP 1's admonition to construe, administer and employ the rules for the just, speedy, and inexpensive determination of every proceeding.

Judge Hedges warned against conceiving of proportionality just in terms of dollars and cents and warned that other factors had to be considered as well.

In a video clip Judge Jeffrey Sutton of the 6th Circuit (the Chair of the Standing Committee on the Rules of Practice and Procedure) remarked upon how the removal of the language in FRCP 26 about the scope of discovery including data reasonably calculated to lead to the discovery of admissible evidence, effected the relevancy of the SCOTUS case Oppenheimer v. Sanders, which was based on a version of the Rule including this language. He criticized some judges for continuing to cite this precedent after December 2015.

The group acknowledged that the amendment to FRCP 37 was intended to address the finding in Residential Funding Corp. v. DeGeorge Fin. Corp., by the Second Circuit that sanctions could be imposed for the negligent failure to preserve.

Judge Hedges said that he disagreed with Judge Francis' dicta opinion asserting that judges still have the inherent authority to sanction.

The video presentations alos consisted of comments by Judge David Campbell of the District of Arizona; and Judge Joy Conti of the Western District of Pennsylvania.

Federal Court Ruling on the Preservation of Text Messages

A U.S. District Court judge in Shaffer v. Gaither, 14-0106 (Sept. 1, 2016 W.D.N.C.) ruled this past September on the plaintiff's failure to preserve text messages on her phone. The court denied the defendant's motion to dismiss which was based on her failure to preserve ESI, that the court could not conclude was intentional. The messages on the phone were relevant to a defamation claim which alleges that the plaintiff's employer stated she was fired for having a sexual relationship with a married man. The plaintiff was an Assistant District Attorney and the person with whom she had the relationship was a defense attorney. The relationship itself was not denied, just the basis for her termination of employment.

The text messages on the plaintiff's phone were said to contain statements in which the plaintiff conceded the relationship was the reason for her dismissal. The plaintiff's phone was unavailable because she damaged it in a bathroom, and she turned it over to her insurer. The case is interesting because of what it shows about the recoverability of text messages and how a court will interpret the recently amended F.R.C.P. 37

The plaintiff's service provider could not produce copies of the text messages. It only kept records of when text messages were sent. There were no back-ups of the texts in cloud storage. Forensic techniques could not recover the body of the texts from the available SIM card. [Oddly, the court's decision does not indicate whether or not attempts were made to recover the phone from the insurer.]

The plaintiff's phone was broken more than a year after she had first threatened litigation. The court noted that FRCP 37 requires that steps be taken to preserve ESI when litigation is reasonably anticipated, but stated that dismissal should not the first resort. FRCP 37(e) requires courts to only take such action as necessary to cure the prejudice resulting from the lost ESI. It did not conclude the plaintiff's destruction of her phone was intentional. It set aside the question of whether any sanctions at all were necessary because other witnesses were available who had seen the text messages - more than just the plaintiff and a single recipient. The need for sanctions was to be determined after witness testimony before a jury on the content of the messages and the circumstances of the phone's loss.

The court's recommended preservation techniques for counsel consisted of, "printing out the texts, making an electronic copy of such texts, cloning the phone, or even taking possession of the phone and instructing the client to simply get another one."

Comparing Rule 26(f) Discovery Plans Part 2

This is a continuation of last night's tip when I compared Rule 26(f) plans freely available on the web from the Eastern District of North Carolina; the District of Minnesota; the Western District of Texas; and a form on the site for the District of New Jersey.

6. Deposition and Interrogatory Limitations. The discovery plan form from the District of New Jersey indicates that the parties should state limitations on the number of interrogatories that can be exchanged and the number of depositions that can be taken. The plan from the Eastern District of North Carolina limits the parties to not just 30 interrogatories, but also 30 requests for admissions, and 30 requests for production. It also gives specific time limits for the 8 depositions each party is allowed to take. The District of Minnesota plan includes a proposal of 15 interrogatories by one party but also a suggestion that the parties abide by the 25 interrogatories provided for by the FRCP. Requests for admissions are not limited, but document requests are confined to 15. The limit on the number of depositions excludes depositions taken of experts. The defendant counters the plaintiff's proposal for a limit of 10 non-expert depositions, which the suggestion that only 10 depositions be allowed in a certain phase, with no limit provided for other phases. The plan from the Western District of Texas states a total number of hours of depositions, rather a distinct number of witness depositions.

7. Deadlines. The New Jersey form has lines on which the parties are to give deadlines for adding parties, the end of fact discovery, filing expert reports, filing dispositive motions, a pretrial conference, and a trial. The North Carolina forms include all these deadlines, and state the number of days for the trial and arrange for the pretrial conference to be two weeks for the trial. The Minnesota plan has different schedules for all these dates submitted by each party. The schedules also include deadlines for class certification filings and a hearing on class certification. The Minnesota plan has a section in which the parties indicate the number of witness they will call at a possible trial. The Texas plan does not provide for deadlines, but does refer to a scheduling order creating deadlines for dispositive motions.

8. Form of ESI. New Jersey directs the parties to indicate whether or not they will have issues about the form of produced ESI, and indicate agreements on the "costs of discovery, production, related software, licensing agreements". North Carolina has a separate section for the "Form of production/preservation" and specifics that ESI be produced in the form in which it is maintained in the ordinary course of business. It also includes the interesting provision that emails have a field indicating who they were forwarded to or if they were replied to. Word and Excel files are to be produced in native format. The parties are not required to alter their regular records retention policies so long as they are in compliance with federal and state regulations. Minnesota simply states that, "The parties will meet and confer regarding the format of retrieving any electronically stored information.", without providing any further information about electronic discovery. Texas makes reference to a separate agreement on ESI issues, and notes one party objects to sharing data over "FTP site and/or Secure Share method".

9. Confidentiality. In New Jersey the parties are to state whether or not they will enter a confidentiality order. The North Carolina plan has a protective order attached which the parties stipulate to. It also addresses privilege issues, something not referenced in the draft New Jersey form. It states that there is no waiver for inadvertently producing privileged documents, and specifies a deadline (10 days) by which such documents must be destroyed after a request is made to do so. The party that makes a request for privileged information to be recalled or destroyed has to cover the costs of doing so. Minnesota calls for the parties to meet and confer and submit a protective order to the court, but does not address privilege issues. The Texas plan mentions a previous motion for a protective order which resulted in such an order being in effect at the time of the plan. It only discusses privilege in the context of the assertion of legislative privilege by certain witnesses.

10. Scheduling Conference. New Jersey calls for the parties to list issues to be addressed at a later scheduling conference held pursuant to Rule 16. North Carolina does not address this issue. The Minnesota plan provides for a scheduling conference after the resolution of the class certification motions. In Texas a scheduling order is already in effect and no reference is made to later conference.